Is Ethereum heading to centralization?

[Come-from-Beyond]

Check https://www.reddit.com/r/ethereum/comments/492fse/serenity_poc2_ethereum_blog/d0okwaw and https://www.reddit.com/r/ethereum/comments/492fse/serenity_poc2_ethereum_blog/d0oik7j, please. Are those centralization concerns legit? I suspect that any real criticism will be shadowbanned on sites controlled by Ethereum marketing team, so I'm asking here.

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[tokeweed]

It could be.  But it's good the all the Proof of Concept(s) are shown and talked about in order to find a solution early.  Serenity's release and the switch to their implementation of POS is years away.  So I'm not really worried...

[sinner]

Ethereum: Centralizing Decentralized Applications

Would a popular decentralized application like Bittorrent work better on ethereum?  You'd have to pay a tax ("fuel") for every download... would every download be recorded on the ethereum blockchain? If the ethereum blockchain were experiencing some problems (such as scalability or a ddos attack), would that prevent programs running on ethereum from functioning?

[doriangray]

Cryptocurrency became popular because of decentralization. Why do we need to centralized it?

This might be a bad move for ETH. Let's see how the market reacts with this kind of news.

[TPTB_need_war]

Check https://www.reddit.com/r/ethereum/comments/492fse/serenity_poc2_ethereum_blog/d0okwaw and https://www.reddit.com/r/ethereum/comments/492fse/serenity_poc2_ethereum_blog/d0oik7j, please. Are those centralization concerns legit? I suspect that any real criticism will be shadowbanned on sites controlled by Ethereum marketing team, so I'm asking here.

Add those to the reasons I already explained as to why Ethereum can't scale with shards and thus can't scale without centralization:

Serenity PoC2

https://blog.ethereum.org/2016/03/05/serenity-poc2/

The error is here on slides 11 & 12:

https://docs.google.com/presentation/d/1CjD0W4l4-CwHKUvfF5Vlps76fKLEC6pIwu1a_kC_YRQ/edit?pref=2&pli=1#slide=id.gd284b9333_0_39

As I predicted:

When will the design details of the new PoS system be shared so we know how they plan to scale?

The plans are sufficiently shared already in the numerous presentations and YouTube videos. I know the limits of the range of choices they can possibly choose from. So I know they are stuck up river without a paddle. They will eventually realize this, and then either they will try to shoehorn some crap that creates a Prisoner's Dilemma and breaks Nash equilibrium (such as "transaction receipts") and/or [...]

Again a receipt instead of every validator validating breaks the Nash equilibrium and creates a Prisoner's Dilemma:

I will repeat again for the 10th time in this thread. Every validator must be able to validate the entire history of the lineage of transactions for the shard that validator is responsible for. Otherwise that validator can't be sure it is not going to lose its funds (i.e. electricity for PoW or deposit for the proposed consensus-by-betting) because it approved an invalid transaction due to some lie in the history as trusted but not validated. Combine this with the impossibility of sharding the gas as explained already to you.

Vitalik has replied to your comment on the page that I linked above,
so there's some bigger game for you.

Thanks. I replied again to Vitalik:

https://blog.ethereum.org/2015/12/28/understanding-serenity-part-2-casper/#comment-2551146572

Vitalik hasn't replied.

Using a receipt is lowering security by orders of magnitude,correct?

I haven't tried to model it quantitatively. It might be a long-tail distribution, thus maybe they can get away with for a while until there is failure of the Nash equilibrium and perhaps split into multiple forks that refuse to converge.

It is something for them to think about, not me. I wouldn't waste my time with that sort of design flaw. Thus I am not that interested in developing a model of its failure. Limited time and resources to do work that doesn't benefit my goals.

Just to reiterate or resummarize, if a validator of a shard has to trust the validators of other shards (for cross-shard state, e.g. the gas balance from one shard being spent to run a script that resides in another shard) then it creates a game theory which is not a Nash equilibrium but rather a Prisoner's dilemma, because the trusting validator can lose his income if the other validators lied to him (and that includes all blocks downstream from that one). Now one could perhaps reduce the probability of the other validators lying over the short-term by incentivizing them to report each other in exchange for a reward (proof-of-cheating), but I analyzed this for my own design and realized it is flawed and abandoned the idea. Because of several reasons such as those validators have an incentive to become coordinated to cheat (in some game theories whereby they can profit, e.g. shorting the coin), and it is impossible to make the reward more than any possible value that can be gained from cheating, etc...

Also the Dapps look mostly like nonsense or they don't need Turing complete scripts:

WOW....

all these prediction would be fit perfectly in augur... LOL 

Except that augur is nonsense, because the market is not an accurate prediction paradigm. The market speaks, but after the fact.

I could sell you idiots turds wrapped in a Snicker's bar wrapper and you'd buy it, take it home proudly, and put in your ref for safe storage without ever opening to verify it. Then later when your frig smells like shit, you go searching for some poo and never open the Snicker.

augur more like decentralized betting market,  they want us to bet on everything.  if you look at it that way, it actually make sense.

True. But we can already do that. What augur is trying to do is figure out how to record of the outcomes decentralized. But the problem is that violates the Nash equilibrium (since users have game theories to profit on reporting different outcomes). I don't expect Augur to function decentralized and expect it to diverge into chaotic disorder unless they centralize control of the recording of the outcomes (in which case they've accomplished nothing). Bitshares is centralized which enables using a price feed for the BitUSD algorithm.

There is a lot of bullshit floating around in this forum.

[enhu]

If they indeed partnered with Microsoft, I wouldn't be surprise if they go centralized like how nxt end. The devs aren't in control anymore of where its heading so its likely going to be centralized knowing how Microsoft works.

[fartbags]

They're working towards a PoS mined coin. This required ETH to mine so only those with ETH can mine. You could call that centralization. ETH will be fairly decentralized. Of course there will be a new coin that comes out and gets better decentralization but ETH will be pretty good.

There will be 1000s of coins that reach a billion $ marketcap with tons of users. This is where the true decentralization comes in, when there are 1000s of different coins distributed through the world.

[TPTB_need_war]

ETH will be fairly decentralized

Like Bitshares, Nxt, and Bitcoin which are all centralized. The Chinese mining cartel 51% attacked any block size increase. Nxt is run by a dictator. And Bitshares is run by a father & son.

[Come-from-Beyond]

And Bitshares is run by a father & son.

The same can be said about Christianity too but the users are happy.

[monsterer]

Will they add checkpoints? That'll give you a very definite answer. If they don't it could be the first high value target worth of a PoS history attack.

[freshman777]

The litmus test for decentralization of a cryptocurrency is the government "asking" to add transaction filtering policies to the protocol. Then we shall see who is true, and who's been swimming naked.

[TPTB_need_war]

The litmus test for decentralization of a cryptocurrency is the government "asking" to add transaction filtering policies to the protocol. Then we shall see who is true, and who's been swimming naked.

I think we will see centralization effects much earlier in terms of monopolization of profits. Well we already have with the Chinese mining cartel preventing even an increase to 2MB blocks, ostensibly so they can increase transaction fees. We have already seen it over at Bitshares with the bidding out a Cryptonote clone implementation financed by a private investor who can then set and earn transaction fees for the (optional) anonymity feature.

What this all seems to indicate is that there is no such thing as decentralization and commerce is always a winner-take-all paradigm of the natural power-law distribution of wealth and the Iron Law of Political Economics.

Fuck our idealism right? As long as we can earn a buck while Rome burns, that is just natural?

Personally I am not a believer that we can't change the fundamental forces of nature.

Look around and notice the phenomena in nature which remain decentralized, such as reproduction. Why? Because such phenomenon only require local partial orders. Global consensus is a global partial order (meaning an arbitrary choice of a combinatorial expansion of potential global orderings).

However we have one model of global agreement which has a stable equilibrium in terms of game theory strategies. That is the Nash equilibrium, which basically says that the optimum strategy is known and thus we can then compute from that stable strategy the economics and relevant outcomes of the system. With Bitcoin, the Nash equilibrium doesn't fail due to selfish-mining because none of the miners have more optimum strategy to pursue than normal mining for those with < 25% of the hashrate and selfish-mining for those with > 25% of the hashrate. So the Nash equilibrium doesn't prevent devolution into centralization, rather it only guarantees that the optimum strategy is known.

In terms of avoiding centralization of global consensus it is really about destroying economies-of-scale. We have an example for this on the internet. It is the End-to-End Principle, which basically says that the network where the economies-of-scale are applied should be fungible and substitutable and thus all the smarts and control lies at the ends of the network. Thus the ends can be diverse and leverage economies-of-scale without being captured by the economies-of-scale.[1]

That is my design to fix crypto currency. Someone has named it "savoircoin".

Note Iota is an attempt at a similar goal, but the Nash equilibrium doesn't exist for the ends (or at least it hasn't been proven that their optimal strategy is known) and thus I allege it devolves to non-consensus without centralization.

[1]

Cryptonote and Z(ero)cash are end-to-end principle anonymity systems, because the anonymous constructions are created by the ends autonomously without involving a network of masternodes. This is why Dash and Vcash's Chainblender suck. Note however that none of these coins have made mining and validation stable end-to-end principled.

[TPTB_need_war]

And Bitshares is run by a father & son.

The same can be said about Christianity too but the users are happy.

Even immortal Gods can lead to Spanish Inquisitions.

The same can be said of the earlier stages of totalitarianism, such as when Hitler printed money out-of-thin-air to finance socialistic work programs (e.g. built the Autobahn) after the rekted Weimar Socialistic Republic failed, but then he couldn't print oil for free so he has to go take resources.

[Snail2]

And Bitshares is run by a father & son.

The same can be said about Christianity too but the users are happy.

Unlike bitshares, Christianity have a third shareholder (however this three are usually considered as one) a well known CEO, vast corporate infrastructure and lots of local sales and support offices. Also it's old and established and thought to be too big to fail. Most importantly it  promising rewards only in an afterlife instead of right here and right now, so it's a lot more difficult to testify . Of course users are happy.

[TPTB_need_war]

Basically all block chain projects have decided to abandon decentralization and just pretend (whether they realize it or not)[1]. So they can do features that don't work without centralization.

Come-from-Beyond say people are happy with that, and the sheep usually are happy to be lead to their slaughter.

[1] Note Monero has the most ASIC-resistant hash released thus far. They haven't solved the economic centralization issue, but for the time being afaik I presume mining is reasonably decentralized.

[chryspano]

TL DR

What CfB and TPTB_need_war wants to tell you is this...

Everything sucks except our own creations!   

Everyone should buy CfBCoins and TPTB_need_warCoins! Everything else is crap! really!

[Come-from-Beyond]

TL DR

What CfB and TPTB_need_war wants to tell you is this...

Everything sucks except our own creations!   

Everyone should buy CfBCoins and TPTB_need_warCoins! Everything else is crap! really!

You oversimplify.

[Naughtid]

They're working towards a PoS mined coin. This required ETH to mine so only those with ETH can mine. You could call that centralization. ETH will be fairly decentralized. Of course there will be a new coin that comes out and gets better decentralization but ETH will be pretty good.

There will be 1000s of coins that reach a billion $ marketcap with tons of users. This is where the true decentralization comes in, when there are 1000s of different coins distributed through the world.

You can buy the Ethereum during the PoS stage and mine it yourself. Then it will not be centralisation any more. It is that simple.

[altfolio]

And Bitshares is run by a father & son.

The same can be said about Christianity too but the users are happy.

That made my day. Thanks

[TPTB_need_war]

Everything sucks

So you can't disprove the facts I claim. So you admit I am correct.

except our own creations!

After making incorrect assumptions about the facts of the other coins, now you want to make assumptions about my motives. Don't you think you've done enough ASS-U-MING. How about learning to study facts.

My motivation is to shame you into studying technology if you want to invest in technology. If you just want to steal from greater fools, then we will understand that your post is just more P&D obfuscation tactics.

Btw, when I talk about my own designs, I am careful to point out potential flaws and caveats. Also you will find that any white papers from me will attempt to have a section that explains positives and negatives to laymen (minimizing/explaining the technobabble). Hypesters don't.